This chapter describes the historical context of both federal and private sector involvement in hazard mitigation in the United States prior to the passage of the Disaster Mitigation Act of 2000 (DMA 2000). This description will look at both early hazard mitigation planning efforts and at examples of post-disaster mitigation to see just how the roles of the private sector, of the government, and of individuals came about and how they have changed over the time period leading up to DMA 2000. This chapter begins with a historical overview, followed by a discussion of 1) the ways the various sectors have interacted with each other; 2) the roles they have played; and 3) an analysis of the range of options regarding which sector ought to be responsible for the provision of hazard mitigation as indicated by the literature as well as applied in practice, a question which has sparked considerable controversy.
A Historical Overview of Hazard Mitigation Prior to the Disaster Mitigation Act of 2000 In order to adequately chart the evolution of federal government involvement in hazard mitigation, it is necessary to begin by looking at the federal government’s involvement in disaster recovery. The federal government has been involved in disaster recovery as far back as at least the early 1900s, but this involvement was isolated to particular events, and there was little to no involvement in hazard mitigation efforts. Early efforts at hazard mitigation were either undertaken by individuals or by corporations for their own protection or were driven by economic considerations and/or the insurance industry. An excellent example of this followed the Great Chicago Fire of 1871 when pressure from the private sector led to the adoption of fire codes by the public sector in many parts of the city.
More extensive federal involvement with hazard mitigation, although still driven by disaster events, began with flood-protection efforts. These efforts focused solely on structural
mitigation projects following a series of flood disasters. Beginning in 1917 and culminating in 1944, Congress passed a series of Federal Flood Control Acts; they led to the federal government taking on the costs of constructing structural mitigation projects such as dams and levees and to giving the U. S. Army Corps of Engineers (USACE) a major role in disaster recovery efforts (FEDERAL, 1996). During this time period, disaster recovery efforts were piecemeal, were not associated with any particular federal agency (despite the growing role of the USACE following floods), and were dependent upon congressional or presidential action. For example, Congress provided some disaster recovery funds for a series of significant floods, including the 1927 flood. It is unclear the extent to which the federal government utilized private contractors in these early efforts (if they were utilized at all); however, private sector entities do appear to have been actors in some of these efforts. For example, many of the early USACE studies utilized local engineers (Respondent 3).
In 1950, this piecemeal approach changed when disaster relief for victims of flooding was made into official policy with the passage of the Federal Disaster Act (FEDERAL, 1996). This legislation occurred in a period of continuously increasing floodplain occupancy and of a
growing belief among individuals and local governments that the federal government would step in and offer assistance once an area had flooded (Wright, 2000). The national culture of disaster recovery (and hazard mitigation efforts by extension) shifted away from the model of 1871 in which individuals and corporations occupied the primary role without government involvement. By the 1960s, the increase in federal expenditures on disasters coupled with the increasing number of individuals at risk had institutionalized the costs to the federal government and set the stage for additional federal legislation to be put in place, as described further below.
Throughout this time period, the USACE often remained the primary federal agency involved in disaster recovery. It also began to create Reconnaissance Reports for communities with significant flood problems. These reports followed a systematic method of taking a basic look at the flood problem, looking at alternatives, and determining if a flood control project could be done. In many cases, these reports indicated that structural projects would not be an option, and they helped to shift the focus to smaller projects that the states and communities could do. This was a driver for local planning efforts in Illinois (Respondent 2). (These efforts will be described later in this chapter). However, the reports themselves focused on large flood control projects. Their influence on local efforts depended very much on local officials who could choose to use them as a means to spur local action. Over time, the USACE moved away from doing those reports; their focus shifted to more exact planning for much larger projects. The National Flood Insurance Program
As described above, the growing federal role in and increasing expenses related to flood recovery set the stage for the creation of the National Flood Insurance Program in 1968, which was the first significant public sector involvement in mitigation prior to a disaster (Respondent 1). Earlier efforts had focused primarily on disaster recovery and not on the incorporation of mitigation, much less mitigation outside of the recovery context. The NFIP made flood insurance available to homeowners in participating communities, something which private insurers were not able to offer due to the high level of risk and to the challenges of maintaining a sufficiently diverse portfolio to diversify that risk (FIFMTF, 1996). The private insurers simply could not provide flood insurance policies at a low enough premium for a sufficient number of policies to be purchased. Although many respondents did not consider the NFIP to be an example of a federal mitigation initiative, it was in fact created in part to reduce losses to the
federal government following floods (Respondent 1). Initially, the insurance component was managed by a consortium of insurance companies known as the National Flood Insurance Association (NFIA). These companies “were used to hazard mitigation, had grown up with the accepted concepts of reducing risks, reducing consequences, through zoning and building codes” (Respondent 1). This partnership model between government and private insurers allowed for greater ease of arbitration and brought together the expertise of companies and individuals who were trained in reducing risks and consequences. The insurance industry, as illustrated by the Great Chicago Fire, had long been a driver of risk-reduction efforts (Respondent 1).
However, some within the Department of Housing and Urban Development (HUD), which was then responsible for disaster response, were concerned at a lack of transparency in the process of determining damages, feeling that HUD was simply being billed for damages without transparency in the claims process (Respondent 2). The role of private insurers was reduced in 1978 when the decision was made to shift away from the use of the private sector and to the use of the federal government to manage the NFIP. However, the private insurers were later re- engaged through the Write Your Own (WYO) program under President Reagan and eventually managed over 90% of all policies, but did not assume the risk (Respondent 2). There was a concern that the insurance industry was making too much money and that the system had been designed to place greater costs on the government than on the private insurers (Respondent 1). Unfortunately, detailed records regarding flood insurance policies at this time are not available; it is unclear if there was indeed any impropriety (Respondent 2). This is particularly interesting considering the fact that the federal government entered into the insurance market specifically because private sector insurers did not consider it economically viable to offer flood insurance at rates that homeowners could afford. This shift had several negative consequences for both the
federal government and for policyholders. Some respondents argue that the focus on insurance as a driver of risk reduction was lost at this time (Respondent 1). Private companies are still responsible for wind coverage, leading to challenges in disasters such as hurricanes where flooding and winds occur simultaneously. This has often resulted in battles over which damages are caused by wind or by water (flooding). These battles are difficult to resolve without the partnership of coverage within the same entity, despite the fact that insurance companies are still involved through the Write Your Own (WYO) program. Whereas initially the need to reduce costs (profit motive) drove hazard mitigation, it now drives insurance companies to declare that flooding has caused damages (including more recent court battles regarding the distinction between wind-driven rain and other sources of water damage) and are therefore not their responsibilities (Respondent 1). This results in harm to the policyholders due to the fact that they must await resolution of this conflict to receive their insurance award to begin rebuilding.
It is also interesting to note that the mandatory purchase requirement, which requires borrowers who are purchasing a home within a mapped flood zone to purchase insurance, has been consistently ruled by the courts to represent protection of lenders and not just of
homeowners (GFW Forum, 2010). This is particularly relevant because the protection of the lenders helps to ensure the continued availability of home loans within the floodplain and
potentially contributes to the further development of the floodplain. This in some ways supports the arguments that the NFIP has promoted development of the floodplain by both subsidizing insurance and requiring its purchase when a mortgage is secured.
During this same time period of growing federal involvement, and beginning in 1973, HUD was given authority over disaster relief and recovery, which it retained until the formation of the Federal Emergency Management Agency (FEMA) in 1979. The Federal Disaster
Assistance Administration (FDAA), a subset of HUD, was responsible for disaster operations and utilized disaster reservists20 in addition to some full-time staff in its response efforts. Once FEMA was created, it continued that policy of utilizing reservists to increase capacity following a disaster. The reservists served the same function as private sector contractors, supplementing existing federal staff when additional resources were needed. The reservist model is, in some ways, an alternative to direct, private-sector involvement which is also utilized by FEMA. Some of these reservists spent years responding to a variety of disasters and began to ask “Why are we putting this back the same way? Is this a non-efficient use of government funds? Isn’t there a better solution? Haven’t we been in this town before? Haven’t we fixed this bridge before? What are the costs” (Respondent 12)? Although FEMA officially recognized mitigation as one of the four phases of emergency management, it was pretty much treated as “just an idea in the mind of a number of researchers” (Respondent 14). Initially, mitigation was considered to primarily consist of building codes and construction standards (both of which are controlled locally); perhaps this was due to the earlier role that played by HUD. There was little to no money associated with mitigation at this time. Although federal expenditures on recovery had increased dramatically, the NFIP, with its flood mapping program and the requirement for local flood ordinances that reflected the flood map risk, was still the significant federal mitigation effort outside of isolated actions by reservists and others (Respondent 14). In fact, the effectiveness of the NFIP as a risk reduction measure, or even as a means of reducing
government expenditure in disasters, has been called into question, as is described further in this chapter. Although the NFIP did require that certain regulations be met, it also had the adverse effect of increasing federal expenditures through the payment of claims to homeowners who built their homes in high-risk areas.
The Blizzard of 1978
HUD did lead an extensive mitigation effort following the “Blizzard of 1978” along the New England coast. Following the blizzard, the substantial damage requirements of the NFIP were enforced for the first time, showcasing the role of the NFIP in promoting hazard mitigation during recovery when utilized in this fashion (an example of the power of street-level
bureaucracy and individual discretion). Substantial damage requirements are triggered when a structure is considered to be more than 50% damaged. In cases of total destruction it is clear that substantial damage has taken place, but there is a greater amount of subjectivity when damages are moderate or not clearly visible from the exterior of a property. In many instances local officials under designate the number of substantially damaged properties in an effort to alleviate the potential regulatory burden on homeowners. However, this only serves to promote their continued high risk. HUD employees chose to actively enforce and promote substantial damage requirements, in part by showcasing the value of hazard mitigation.
An additional resource from the NFIP was Section 1362, referred to as the 1362 Program. It allowed for the buyout of properties. This was part of one of the first concerted federal efforts at post-disaster hazard mitigation. The recovery effort included the compilation of the first post- disaster hazard mitigation report, and it marked the first real organized effort to integrate HUD’s flood insurance program into disaster relief efforts. Mitigation efforts in New England were driven by committed HUD staff and were supported by state leadership (Respondent 1). They included elevation of homes on a voluntary basis, wet flood proofing21, dry flood proofing22, and other innovations. The Small Business Administration took on a role as well, paying out disaster
21
Wet flood proofing is the use of materials that can survive brief inundation and other mechanisms to minimize damages when water does enter a structure.
22
Dry flood proofing is the use of sealants, short walls, and other mechanisms to prevent water from entering a structure.
loans that, for the first time (following the intervention of the Lieutenant Governor of
Massachusetts and the Speaker of the United States House of Representatives), included hazard mitigation elements. The interest of the Lieutenant Governor in promoting hazard mitigation was a key driver of the efforts that followed and illustrates the extent to which one individual can have a significant impact (Respondent 1). In fact, individual action and community desire for change appear to have been far more of a driver than was the existence of federal policies, although it can be argued that the existence of federal programs was a key resource to this effort (Respondent 2, Respondent 8).
Just as there were in New England in 1978, over the course of the 1980s and early 1990s there were isolated efforts at hazard mitigation across the nation. These efforts were dependent upon having a committed individual in a leadership position, such as the Federal Coordinating Officer (FCO), upon the knowledge or interest in mitigation of the disaster reservists responding, or upon having a state that was already progressive in that regard; however, hazard mitigation at this time could be described as a “guerilla” effort (Respondent 1) by some dedicated FCOs and others within FEMA and in certain states; it “had a lot to do with personal leadership and personal values” (Respondent 1). When hazard mitigation was undertaken, it was done quietly to avoid controversy or push back by agencies—another example of street-level bureaucracy at work. The philosophy among those who promoted mitigation was to avoid documentation and to use public assistance and other funding sources, such as SBA, as creatively as possible to do what needed to be done. “We just wanted to do what had to be done and then leave”
(Respondent 6). However, in cases where state government was very supportive, such as in Massachusetts in 1978, a great deal could be accomplished. Unfortunately, as late as 1990, the mantra remained: “Restore to pre-disaster conditions” (Respondent 1). Through the early ‘90s,
more and more likeminded people began pushing for hazard mitigation, and it gained greater acceptance.
In addition to these isolated efforts, there were changes at the federal level that helped to set the stage for increasing hazard mitigation. One of these changes, in the early 1980s, was the formation of the Flood Hazard Mitigation Task Force as a result of a 1980 OMB directive that all federal disaster assistance programs incorporate mitigation (Respondent 6). The Task Force was composed of twelve federal agencies that provide technical assistance for non-structural
measures during the recovery phase, and its goal was to ensure that personnel would be available to search for obstacles to mitigation in current policies and to participate in post-disaster teams (Wright, 2000). As a result of this OMB directive, interagency teams were convened by a mitigation officer following a disaster; they created hazard mitigation reports, also called 15-day Reports. This team would include representatives from USACE, SBA, National Weather
Service (NWS), and others. It was given 15 days to identify ways in which existing programs could be used for hazard mitigation and to identify opportunities. The teams also created a 90- day follow up report.
Many respondents saw these teams as excellent mechanisms for fostering collaboration among federal agencies, for promoting coordination between the state and federal efforts (and occasionally the local), and for focusing on mitigation. Much like the role of committed
individuals, the institutionalized creation of collaborative groups, which (as described in Chapter 2) could function as performance regimes, resulted in a great many successes; however, these groups were more effective in some regions than others, depending greatly upon their
implementation. In some cases, the 12 federal agencies would send different representatives to each meeting or would send individuals who only had knowledge of their own program, not of
the range of programs offered by their agency (Respondent 12). Although the various federal agencies, such as the Department of Agriculture, all had or were developing relevant programs for funding and technical assistance, these programs were not always utilized or brought to the attention of the teams. This conundrum remains a challenge today. The wide-range of programs available is not widely known, and there are various challenges to face in making the guidelines work with each other, a problem which has only been exacerbated by the now long history of program implementation and resulting bureaucracy. The Coastal Barrier Resources Act of 1972, which prohibited the expenditure of federal resources on undeveloped barrier coastal islands (denying flood insurance and disaster assistance to anyone who developed those areas), was a key tool as well.
Federal Emergency Management Agency
FEMA Region VIII23 was one region that quickly saw the value of mitigation. It took steps to convene the team outside of disasters and to identify the most appropriate individuals from the agencies represented. The team in Region VIII was headed by FEMA reservists, many of whom had come out of graduate programs at the University of Colorado and were focused on
floodplain management; as previously described, other regions also utilized reservists and